Elements of a genuine tax reform

Manila Bulletin 14 hours ago

In 2009, I joined the Bureau of Internal Revenue (BIR) as an examiner with the hope of making a
difference. Like everyone else in BIR, I was stereotyped as corrupt or buwaya.
While that didnt bother me, what did was how seemingly normal and acceptable were the
wrongdoings and bad practices both examiners and taxpayers were accustomed to. Everyday was an
opportunity to make money for an examiner, with almost all transactions subject to negotiation for
taxpayers.
More than a year later, I resigned to keep my faith in the reform I wished to instill in the BIR. I was
losing hope. Each day I was convinced that more than the taxpayers, the examiners were the victims
of the corrupt system we have nurtured to this day.
At the height of the P10 billion Napoles scam involving lawmakers, BIR examiners are tasked to meet
the increasingly ambitious P1 trillion collection goal. What do you think motivates an examiner to
collect taxes given their almost minimum wage salary?
According to Dr. Estanislao, Civic duty calls upon each of us to act generously. Instead of looking for
loopholes for taxes and other required contributions, we should think of even more ways to help.
Does this even mean anything to us?
Uniting for integrity
The feeling of being in a crowd of individuals committed to reform is a blessing. As Dr. Estanislao
shared in his latest book, To transform our government, economy and society, we must begin with
ourselves. We must introduce love and discipline into our personal lives and into our work in order
to become better persons and build better institutions.
I have just started reading his latest book entitled, The Importance of Hope: In pursuit of our
personal mission. I had the privilege to be invited to his book launch held last September 8 at Fully
Booked in Taguig City. The date of the launch made it more special for Catholics as it falls on the
birthday of Mama Mary. She is an inspiration of faith, hope and loveexactly what we need to start a
genuine tax reform, coupled with a little more faith in God, hope for the next generation, and a little
more love for our people and country.
We need to be reminded of the essentials, of more important things than money and power. We need
to surround ourselves with like-minded individuals, support every noble initiative to initiate reform,
and unite for integritynot for family or political party.
Themed Uniting for Integrity, the Integrity Initiative believes that working together under a
common stand is the key towards making an irreversible impact in the rally against corruption. The
business sector enjoins other groups to embrace integrity, if the country is to succeed in attracting
investments that will create more jobs and level the playing field. While highlighting the progress of
the private sector in spreading ethical standards in business, the Integrity Summit 2014 will also
present initiatives of the government, the church and the academe towards a culture of integrity.
To know how we can address tax evasion in the private sector and corruption in the government, join
us in the 2014 Integrity Summit at the Dusit Thani Hotel on September 19.
Tax mapping, pa-KIM-kim style
Unfortunately, Commissioner Kim Henares campaign is being used to extort money, especially from
our doctors who are getting sick of the so-called series of harassments. If you dont want to be
dragged into the 270 list of tax evasion cases, better settle and offer pa-KIM-kim.
I have reminded Commissioner Henares of this loophole in our tax system. In as much as we want to
rely on audit, its either our examiners will be harassed by big-time businessmen, or examiners will
leverage on the strict regulations to extort moneywhether they admit it or not.
In this case, we are not helping our taxpayers to be honest in paying taxes. As one of the doctors
shared, they are being advised already by their accountants to lower their voluntary payments and
save a budget for the audit.
This has been the way small businesses are coping with the high tax rates, but now professionals are
being led to the same bad practice. It is becoming more convenient to compromise than to pay the
right taxes, as it is more often than not coupled with high penalties and compromises. Why pay more
when you can get a discount?
As Dr. Estanislao concludes in his book: With hope, we are able to make the basic connections
personal governance demands: between now and the future, between here and the wider world, and
between ourselves and others. In doing so, we grow closer to obtaining personal happiness (and a
better Philippines).
Mon Abrea is the founding president of the Center for Strategic Reforms of the Philippines (CSR
Philippines), a non-profit organization that champions and consolidates initiatives to empower the
MSMEs. He is also the Chief Strategy Officer of the countrys first social consulting enterprise, the
Abrea Consulting Group (ACG), which offers strategic finance and tax advisory services to
businesses, professionals and individuals. Feedback is welcome at consult@acg.ph.